The Best Frauds, Scams, and Big Company Cons in America Today

The Dallas Conspiracy -- Monopolistic Airline Practices

FOR MORE THAN 15 YEARS, MAJOR U. S. AIRLINES HAVE USED PRICE-FIXING CONSPIRACIES TO CHARGE UNREASONABLY HIGH AIR FARES, WHEREVER THEY CAN, AND IT HASN'T STOPPED. Isn't this proof the U.S. Government won't act in consumers' best interests? What more can you ask for, than a 15 year track record?

EXECUTIVE SUMMARY:        Wholesale Consumer Fraud by Price-Gouging. Nature of Fraud: Wherever a supplier of a service (in this case, air transportation) can get away with it, they charge fares that are totally out of line with the costs/expenses involved in providing the service. They do this by having "tacit agreements" with their "competitors" -- wherever they can get them to agree NOT to compete, the public is ripped off, wholesale. Moreover, the Federal Government will not act, because of huge industry kick-backs. Core Issue: We've all known or suspected for a long time that Airlines are ripping us off with higher fares than they should be charging for some trips, but we typically have not paid enough attention to the details to nail them to the wall. And if we could, who can do anything about it? The Federal Government is hypocritical in applying its laws uniformly. They may make a big fuss about a trivial issue or a small operator, to make you think they are really doing something. But all along, they let the largest companies in America rip you blind. Isn't the reason obvious? These major corporations have big lobbying efforts in Washington, they grease the skids with money, and they have direct pipelines to Presidents and Congress to make sure their profits aren't hurt. We saw this favoritism with AT&T, we saw it with large companies like Sears, and now we see it with the darling Airline Companies of the U. S. "Oh no, we can't do anything to hurt them, they make the wheels of progress spin!" -- Sure, until you personally are hit with some ridiculous fare, because of a conspiracy. People say the Word Trade Center issue will make the airlines "shape up". Rubbish. They may get better security because they HAVE to, but it will do NOTHING to alleviate the ludicrous cost of some air fares in certain parts of the country -- depending on who does and doesn't fly there.

Reader Submission: We have wanted to report on this issue ever since BestFrauds got started, but we did not have the right facts and figures to kick it off. Finally, we got a submission from someone who had clearly done his homework -- for many years. Keep in mind, the following is not a complaint about any particular Airline Company -- rather it is an accurate statement of the liberties given out freely to an entire industry, at the public's expense. ------------------------------------------------- Your Best Frauds website has some very good points, but there is one really BIG fraud you are missing. That is the airline companies -- how they form hidden conspiracies among themselves, to charge outrageous fares, wherever they can scam people. In particular, I refer to what I have called for more than 15 years now, "The Dallas Conspiracy". Dallas is the prime, but not only, example. From about 1975 through to 1990, I was doing a lot of flying in the western U.S., which included Dallas and the Pacific Northwest -- mostly leaving out of Phoenix. For the longest time, the Phoenix to Dallas fare was fixed at $695, but later dropped to $595. For more than 15 years, this was the highest fare in the country, per mileage -- way above anything else like it. Phoenix-Dallas is only 800 air miles, and you could regularly fly 600 air miles to California for under $ 100. Gosh sakes, even to go to Chicago and D.C. was cheaper than flying into Dallas -- so I started to realize that there was some kind of conspiracy going on with Dallas. Then I looked into other fares going into Dallas -- from points east -- and many of them were also extremely high. However, from a few cities, the fares where cheap. You could fly from N.Y.C. to Dallas for less than I could from Phoenix -- almost 3 times the distance. It just didn't make any sense, and I was going broke with these fares. Then when I had to fly to the Pacific Northwest -- mostly between 1979 and 1988 -- things started to make more sense. There was a similar conspiracy going on there -- the fare was fixed right at $400 for more than 10 years, and it never varied, even though there were cheap specials to most other parts of the country. I recall one Christmas, it cost me more to visit my mother in Washington State than 3 people could fly to New York for -- and a friend got a deal to England and back for less than I paid to fly from Phoenix to interior Washington, via Seattle (whole fare was about $800!). I was so infuriated, I did a lot of checking -- and at that time, I discovered there were only THREE airlines flying the Pacific Northwest Route -- Alaska Airlines, America West, and United. Pay attention to those 3 -- you might see them in other conspiracies. Alaska Airlines was the "leader" with the "great" special of $399, instead of the $401 that America West charged, and the top $ 402 that United charged. Admittedly, it was longer and less cost than going Phoenix-Dallas -- but only $3 price difference fixed for nigh on a decade? Give me a break! Now, you could try to circumvent this conspiracy by going into Seattle from Phoenix via California, but with 3 plane changes and only $40 saved, it wasn't worth the hassle. And the airlines knew it! Alaska had Seattle sewn up on the way to Anchorage, and America West was the only other "biggie" in Seattle -- so things began to fall into place. These 3 airlines were conspiring together to fix prices and screw us travelers. As long as they had a "captive route" -- meaning there were no "wild card" airlines in the picture, who might offer special prices to break their monopoly -- their price fixing would go on for as long as they could get away with it. Later, I revisited the "Dallas Conspiracy" to see what had changed. Still the same outrageous fare of $595 -- nothing had changed, and there were no specials or cheap fares -- ever. Guess what I found? At that time, the only airlines flying the Phoenix to Dallas route were America West and United. Hey! There was a pattern here. Investigating further, I found for the cities where a different airline company also had service, the fares were cheaper, but wherever only America West, United, and other "safe" (i.e. no "wild card") airlines flew, the fares were extreme, with never any specials. There was one wild card in this conspiracy -- Braniff Airlines -- who flew from Dallas to Tucson [note, not into Phoenix]. Braniff was a great airline -- friendly people, wholesome folk, fun trip. I suppose that America West could not force them to price fix, because they were going through a different town, and onto San Diego [note, not L.A., where America West flew]. So Braniff cut the fare down to a realistic price for the distance -- $179 to $225 Tucson to Dallas. They were only $89 Tucson to San Diego, while America West, for the same distance from Phoenix to L.A., was at least $170 . Needless to say, Braniff didn't last long. When you can't make your competitors conspire with you, then just get someone to buy them out -- and indeed Braniff was soon bought out and "sunk". What reason? So America West could continue to rip people off for more years to come. I figured out that they netted something like $10 billion extra profit on that run, with fares inflated $200 to $300 over what they should have cost. And with that money, they could have bought out 2 airlines. There are many similar buy-out stories with Airline Companies, both National and International. Look at the great deals Continental used to offer in overseas fares -- now no more. But that is another story for some other time. The conclusion of this letter, that you and all your readers need to know is: 1. America West and United Airlines (with or without certain other cooperating conspirators like Alaska) have been running a price fixing conspiracy to artificially inflate airline fares to whatever parts of the country that they can get away with. 2. The longest-standing example of this is the Dallas Conspiracy, which has been going on for at least 15 years. Sure, in recent years (2000 on) they have been forced to lower their fares a bit (they are still $100-$200 too high). But the typical, reasonable cost per-person-per-air-mile for domestic flights is 10c to 20c throughout the country. In shocking contrast, the Phoenix-Dallas fare is almost $1.00 per person per air mile -- 5 to 10 times higher than most other U.S. destinations. (Incidentally, an airline company's operating cost is only about 1cent per person per air mile -- so even average fares are 100% profit -- the Dallas conspiracy pushes it to almost 1000% profit). 3. The way the conspiracy works is that one airline wants to make a killing on a particular route, so they ask others to agree not to drop their fares below what they want. America Worst is the Worst for doing it, and United is the worst for agreeing. United never, never undercuts another airline company's fares on the same route -- have you never noticed -- or are you too blind to see it? 4. Airline companies in the U. S. have what amounts to a carte blanche from the Federal Govt. to do whatever they want and charge whatever they can get away with. The government leaves them alone, because they are supposed to be overseen by the FAA -- which itself gets most of its kickbacks from the airline companies, and is never going to tell them how to run their business. They only enforce the mundane stuff, like safety guidelines, that make people who fret over safety, real happy. 5. You and all your readers need to realize one thing very clearly -- I have no axes to grind with any particular airline, as I have flown most of them. I do resent paying America West and United more than $30,000 more than they should have got from me in the years I flew, but since a lot of this was on an expense account, I have no axes to grind. What you have read is just very thorough research. 6. Despite everything people may say about airline companies, one thing stands out above all other things -- they are the biggest conspirators in America today. Now, 20 years after I first started seeing these rip offs, fares may have dropped a little, but things haven't really changed one iota. They are still ripping us off blind, and still charging arbitrarily high fares wherever they can get away with it. 7. The ONLY reason that they get away with it is because the American public is so gullible that they will look for any excuse not to take a stand against extortion and conspiracy in large companies, like America West and United. They expect the government to do what they are too wimpish to do -- i.e. take a stand against being scammed. The federal government, of course, couldn't care less, and is so amused by the lethargy in America today that they are laughing themselves silly! I hope every lethargic person in the U.S. gets ripped off as much as I did. It will do you all a lot of GOOD! P. R., Az.. -- Received, Feb 28, 2002
Conclusion: Phew! What more can we say to that! This reader not only took the words out of our mouth, but sucked the wind out of our presentation too. Rather than attempt to add anything to this rather exhaustive analysis of the Airline Conspiracy (aka "Dallas Conspiracy"), we are going to take a totally different tack on this article -- namely throw it open to other reader input, which will be published below. Open for Comments: This section now opens up the "Dallas Conspiracy" to all other reader comments. Before you write however, please note these important guidelines for publishing your contribution: 1. We will not publish complaints against any specific airlines. If poor old aunt grannie got a bad seat and was rudely spoken to on such-and-such a flight -- well, that's normal for airlines these days. There probably isn't a traveler in the U.S. who has NOT been ill-treated by some airline staff. It is a known fact that airline companies and stewardesses are much ruder now than in the period spoken of above. 2. We will not publish any long ordeals about missed connections and other insulting treatment. All airlines do this, because they have been allowed to get away with it for decades. Just look at your local news station to hear this kind of horror story. 3. What we WILL publish here is facts and figures about price gouging, and conspiracies. You can tell from the tone of P.R.'s comments above that he is not out to bad-mouth any one particular airline -- he is just revealing the essence of a price-fixing conspiracy that we all suspected was going on, but which we did not ourselves collect the data to prove. 4. We want MORE articles and submissions with this same theme as the one above. If you have a clear example of a similar price-fixing conspiracy, with factual details, WE WANT TO HEAR IT!
The rest of this section now open for similar articles:   Who will be the first to give positive, constructive feedback useful to other consumers?
Latest Update May 18, 2002